The drugstore giant Rite Aid plans to close 136 of its locations in Michigan, according to bankruptcy documents from June and July. The company filed for Chapter 11 bankruptcy protection last year to settle lawsuits relating to its alleged role in the opioid crisis. The company has also dealt with declining sales.
The move comes as other drugstore chains, including Walgreens and CVS, also plan to close locations.
“It’s just creating a very difficult playing field when so many pharmacies are closing and it creates this access issues for patients,” said Mark Glasper, CEO of the Michigan Pharmacists Association. “There's really no end in sight right now regarding the closures as we see them.”
Glasper said the closures could create “pharmacy deserts,” where patients don’t have local prescription options. “As pharmacies close, not only some of the chain locations but also independents are closing, you start to see access to health care becoming an issue for patients,” he said.
He also said the market for pharmacists was “saturated” and pharmacists and pharmacy techs may soon struggle to find work.
Glasper cited pharmacies receiving low compensation for drugs from pharmacy benefit managers as a cause for closures and struggles across the industry. Those benefit managers are intermediaries who negotiate prices between pharmacies, employers, drug manufacturers, and insurance providers.
“Key to all of these closings is that they're just not getting reimbursed for the drugs that they are dispensing to patients,” Glasper said.
In addition to pharmacists, retail workers are also impacted by the closures. John Cakmakci is the president of UFCW 951, a union that represents workers in the western part of the state. He said the union started with 850 Rite Aid workers before the current wave of closures and is now down to around 230.
“We've got a severance package for them when they leave. If they want a job at another employer that we represent, we'll be happy to take their resume and get them a job at a processing plant or a grocery store or something that we represent,” he said of plans for workers. “We're also bringing in Michigan Works if they want to spruce up their resume and apply somewhere else.”
Cakmakci said the shuttering didn’t come as a surprise to seasoned employees, but it still hurt some of them. “It's been hard because as a clerk working in these pharmacies, they got to know, especially in the smaller towns, their customers. They became friends. They got to know their needs, their families, based on the prescriptions they were picking up,” he said.
In a statement, Rite Aid said it "regularly assesses its retail footprint to ensure we are operating efficiently while meeting the needs of our customers, communities, associates and overall business. While we have had to make difficult business decisions over the past several months to improve our business and optimize our retail footprint, we are committed to becoming financially and operationally healthy.”
